A blog post on eMoney by David Witz. A solicitor arrangement is a common practice among financial advisers (FAs) who want to avoid fiduciary status but still receive compensation in exchange for a referral that results in a sale to a retirement investor. In some instances, the referring FA serves in any number of ongoing non-fiduciary roles such as a communication and/or education specialist, or vendor manager...Continue Reading

Effective October 31, 2016 Morningstar® will enhance the calculation for the Morningstar Rating™ for Funds for open-end (OE) and exchange-traded funds (ETFs), taking into account industry trends to make the rating more useful to investors and the professionals who serve them. These changes demonstrate Morningstar’s commitment to serving investors’ best interests, as they facilitate comparison, increase the global consistency of those comparisons, and reduce the effort required on the part of our clients to perform investment and portfolio analysis in evaluating their investment options. To read Morningstar's full announcement on this change, Read the FAQ.

Plan Consultant Magazine has published another article by David Witz, Founder of FRA PlanTools™. This article discusses why it's up to TPAs to invest in technology that will increase margins by creating solutions advisors want and need to be successful. To read this article, click this link. Tech Solutions Key to TPA's Future.

April 6, 2016 the U.S. Department of Labor (DOL) has issued the anticipated final fiduciary rule. The fiduciary rule makes sweeping changes to the laws governing retirement advice and conflicts of interest in retirement savings. Read the unpublished version by the Employee Benefits Security Administration.

Should the new definition of fiduciary go into effect, there will be more registered representatives (“reps”) held to a fiduciary standard of care who were previously prohibited from operating in a fiduciary role by their Broker-Dealer (“B-D”). As such, B-Ds will have to make one of the following decisions: View Decisions

The Statute of Limitations has become a hot topic since the Supreme Court's ruling in Tibble v Edison. Ironically, the Statute of Limitations does provide a method to reduce or mitigate fiduciary risk for decisions from 6 to 3 years if full disclosure is adopted. Learn how

Best Practices in Share Class conversion is a topic of discussion at the water cooler since the Supreme Court heard arguments by the defendants attorney in Tibble v Edison. While he argued that the time and cost to change to a different share class was onerous the opinion of industry Recordkeepers is that it takes between 1 and 60 days to accomplish the switch. To learn more click here.

Determining and documenting fee reasonableness is critical to avoiding a prohibited transaction claim that would require the fiduciary to reimburse the plan for direct and indirect fees deducted from plan assets. The process to determine and document fee reasonableness was address in the preamble to the regulations but there are best practice strategies that assist with establishing procedural prudence and a strong defense. For more information on those best practice strategies click here.

As we close out the 2014 Calendar Year, PlanTools™ now has 16,699 retirement plans loaded into our system. Of that total, approximately 25% or specifically 4,146 plans have been benchmarked by our subscribers. As our database grows, PlanTools™ is able to provide our subscribers with meaningful statistics on a variety of issues besides fees for services rendered. This report on Stable Value and Money Market Funds is just one example.

David J. Witz, AIF® GFS® provides a high level review of the business opportunity available to those that consult on ERISA 408(b)(2) in Plan Consultants fall release. While most service providers abide by the rules and deliver their disclosures as required on time, other more entrepreneurial service providers are using 408(b)(2) as a means to build their business by assisting plan sponsors with their obligation to evaluate their disclosures to ensure they are complete. I hope you find the attached article helpful in assisting you with developing your own 408(b)(2) marketing approach. However, if you need help developing your deliverables e.g., custom checklist on 408(b)(2), give us a call (704-564-0482) or request if from our support team.

Every retirement plan practitioner has a story about how they began their career in ERISA. Most ended up in the industry by accident and a few of us made an intentional decision to enter the retirement industry. This is a short story on my intentional career pursuit in ERISA and a humorous reflection on the Genesis of ERISA. To read this article click here.

408(b)(2) imposed new disclosures but also required action by the responsible plan fiduciary ("RPF") to determine if the disclosures were "complete" so the RPF could draw conclusions about conflicts and fee reasonableness. Unfortunately, too few RPFs and covered service providers have created a formal process to document compliance with this DOL expectation. To view our article click here.NOTE: FRA PlanTools does provide custom 408(b)(2) checklists with a guide to assist with this assessment process. For more information on the Checklist call David J Witz, AIF®, GFS®, CEO/Managing Director at 704-564-0482 or dwitz@fraplantools.com

The DOL and plaintiff firms will be evaluating the 2012 audit results for trends and vulnerabilities among RPFs and CSPs for targeting DOL audits and plaintiff litigation activity in 2014...To read the full article click here.

On November 16, 2007, the Department of Labor (“DOL”) published a new reporting format for the Schedule C retirement plan tax return, effective for the 2009 plan year, which requires significantly more disclosure of service provider fees and compensation. The new Schedule C disclosure requirements are intended to improve fee transparency of service providers, permit the DOL and plan sponsor the ability to monitor the compensation arrangements of service providers, understand the impact of fees on plan assets and evaluate the value of purchased services using plan assets. These objectives are met when a plan sponsor can obtain the information they need to assess the reasonableness of compensation paid for services rendered to the plan. To read more click here.

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Fiduciary Risk Assessment LLC is the consulting arm and parent company of PlanTools, LLC. PlanTools™ is a cloud based software-as-a-service company specializing in custom built and retail web-based financial solutions.